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V3367-20 17 November 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · estimación directa

Travel expenses recharged to clients are taxable as income from economic activities

An architect has enquired whether amounts paid by clients for travel expenses incurred in a private vehicle must be taxed and whether withholding tax should be applied. The DGT has ruled that these amounts constitute gross income from the activity and are subject to tax and withholdings.

The question raised

Taxation of the amounts received for the aforementioned travel expenses and, consequently, whether withholding should be applied to them.

The DGT's ruling

When carried out under the direct estimation method, travel expenses recharged to clients are considered gross income from the activity. The exemption for travel expenses under the IRPF Regulations only applies to income from employment, not to professional economic activities. Therefore, these amounts are subject to tax and the withholding system.

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